Credit Score Myths and Why They Matter


New research has found that half of the UK public has never checked their credit rating.

Research, credit management company Lowell, found that many people in the UK are unaware of the importance of credit scores, what will and will not affect their rating, and how to check it.

A third of Britons (32%) do not know how to find out their credit score. 10% of people check their credit score only once a year, and only a quarter of people (24%) check their credit score once a month or more.

It’s not that surprising that people don’t like to check their credit score often, as almost one in five (17%) think the number of times you check your credit score is bad for your credit. .

Checking your own credit score is known as a “software check”. The verification will be noted on your file, but it will have no impact on your score. However, applying for new credit, like credit cards, loans, or financing arrangements, will require a “ rigorous check ” from the lender – and repeated requests, or having a lot of them in a short time, can reduce your cost. credit score.

A fifth (21%) of Brits also believe that your job title and income can affect your credit score when it has no impact. 6% of people think borrowing money from friends and family makes a difference, even if it doesn’t have an impact either.

There are a lot of things that can impact your credit score, but more than one in ten (12%) don’t think what they do affects their credit score.

Three-quarters of Britons don’t believe a phone contract can impact your credit report (75%), and two-thirds (66%) don’t think a car loan can affect your credit rating.

Additionally, almost half (45%) don’t think missed payments affect your score when missed payments of 30 days or more can have a huge impact.

Two-thirds (66%) of respondents also didn’t think store cards could affect your credit score. Having many credit agreements, like in-store finances or rental purchases, can lower your credit rating even if you make your payments on time. When lenders decide if they’re going to lend you, they can look at your total credit and the number of different lines of credit you’ve opened to see your total repayments.

Catherine Taylor, 29, of Manchester, didn’t know how to check her credit score and faced obstacles when she applied for a mortgage in 2020. She said: ‘I never even thought to check my credit rating before – no one at the bank ever told me what or how I should. I never had an overdraft or a credit card or missed a payment on my bills, so I thought I would be fine.

“When it came to applying for a mortgage, my advisor told me that I had a low credit rating due to low credit limits, which limited the type of mortgage I could get.

“I was gutted and I wish someone had told me sooner how important it was and what the best ways to put together your case were.”

Commenting on the results, John Pears, UK CEO of Lowell, said: “Ensuring our financial health is a core skill, this survey reveals how critical it is for people to have access to the right tools and resources from within. ‘at a young age, helping them control their finances.

“Your credit score is one of those key tools, it has enormous potential to impact a variety of important life events, such as buying your first home or financing a car. – it is therefore essential that people know and understand their score, what it says. about them and, most importantly, the steps they can take to help improve it. “


About Mary Moser

Check Also

Reading FC were lucky to sign after Aston Villa transfer decision

Reading could try to sign striker Tristan Abldeen-Goodridge after his release from Aston Villa. The …

Leave a Reply

Your email address will not be published.